Termination

Early Termination Lease

Credit Bureau Extract Metro 2 Format users.

When the user terminates a lease that has not yet reached full term.

LeasePak Updates/Processes

• U0103 Payoff
• U0212 Miscellaneous Customizations
• U0239 Credit Bureau Lease/API
• U0462 Credit Bureau Extract
• U0709 Activity Status/Substatus
• U0722 Custom Code

Relevant LeasePak Interface Fields

• U0103 Payoff
  • "Effective Date"
• U0212 Miscellaneous Customizations
  • "Days before maturity for full term"
• U0722 Custom Code
  • "Code Category"
  • "Code Value"
  • "Code Description"
• U0709 Activity Status/Substatus
  • "Account Status"
  • "Processing task"
• U0239 Credit Bureau Lease/API
  • "Asset(s) Return Date"
  • "Activity Substatus"
  • "Special Comment Code"

Process Overview

When LP determines that the applicable date is outside the specified number of days before maturity for a full-term lease, it will set SCC to BE.

When the user sets the appropriate rules/tasks in U0709 Activity Status/Substatus and the corresponding substatus in U0239 Credit Bureau Lease/API, LP will report according to the U0709 rules. For example, if set up and triggered, LP will report as follows during the determination of obligation:

• SMPA as 0
• Account Status as 11
• Current Balance as 0
• Amount Past Due as 0

During termination, U0103 Payoff will set SCC to BF or BG, depending on whether or not there is open AR. The User can override this (and should if reporting BH or AU) through U0230 Credit Bureau Lease/API after termination. Upon termination, the LeasePak activity status will be 'NC**' or 'NP**'. LP will report:

• SMPA as 0
• Account Status as normal
• Current Balance as normal (0 if paid in full)
• Amount Past Due as normal (0 if paid in full)

Each time U0462 Credit Bureau Extract runs, if SCC is BE or BG, the program will check to see if the activity status is 'NP**' or 'NC**' and if there is any open AR. If no open AR and the lease is paid off, then SCC will be updated to BF. U0462 will not update if SCC is BH or AU.

If account is set up as a prepaid lease ("Prepaid Lease" selected/checked/set to 'Y' at time of booking or through U0239 Credit Bureau Lease), LP will report SMPA as 0 until an "Asset(s) Return Date" is entered through U0239. After "Asset(s) Return Date" is no longer blank, the User will need to have the appropriate through U0709 Activity Status/Substatus in order to continue reporting SMPA as 0 prior to termination/payoff.

LeasePak User Process

To specify the maximum number of days before the lease maturity date that a termination/payoff will be treated as early:

• Use U0212 Miscellaneous Customizations to set "Days before maturity for full term". This is the number of days tolerance between the comparison date (return date or termination/payoff effective date) and the lease maturity date to have the termination/payoff be considered full-term
• If you need to have a termination/payoff be full-term only when the lease is terminated/paid off on or after the maturity date, enter 0 (zero), meaning that there will be 0 days tolerance between the comparison date (return date or termination/payoff effective date) and the lease maturity date

To set up special reporting for the period of determination of obligation:

• Use U0722 Custom Code to create a new code for "Code Category" 'ACTSUBSTAT' (Activity Substatus). For example:
  • "Code Value" 'TEDO', "Code Description" 'Term Early Detrm Obl'
• Use U0709 Activity Status/Substatus to create one or more "Activity Status"/"Activity Substatus" combinations, matching likely (according to your business practices) statuses to substatus 'TEDO'. For example:
  • Match 'ANOR' (Active Normal) to 'TEDO'
• For each combination, set the following:
  • "Account Status" to 11
  • And "Processing task":
    • Report Scheduled Monthly Payment Amount to CB as zero
    • Report Current Balance to CB as zero
    • Report Amount Past Due to CB as zero

The Consumer Data Industry Association (CDIA) specifies that account status amounts should be reported as normal up until time of payoff. NetSol recommends caution when deciding to report these differently.

To trigger the determination of obligation reporting:

• Use interactive U0239 Credit Bureau Lease or third-party interface via API to set "Activity Substatus" to 'TEDO'

To use the asset return date to determine whether or not the termination/payoff is early:

• Use interactive U0239 Credit Bureau Lease or third-party interface via API to enter "Asset(s) Return Date"

To use the termination/payoff effective date to determine whether or not the termination/payoff is early:

• Do not enter "Asset(s) Return Date"

Continue processing the termination/payoff:

• Determine the balance owing
• Use U0103 Payoff to terminate the lease once you have a return/grounding date and balance due
• If, for example, SCC BH or AU is needed instead of BF or BG, update SCC through U0239 Credit Bureau Lease/API